In a strategic shift away from its struggling mobile phone division, South Korea’s LG Electronics has finalized its exit by selling its patent portfolio to Oppo. This decision marks the end of LG’s journey in the competitive smartphone sector, redirecting its focus towards growth areas like electric vehicles, smart homes, and artificial intelligence.
LG’s mobile phone division, once a pioneer in several smartphone innovations, has been facing losses for nearly six years, accumulating about $4.5 billion in deficits. Despite its historical achievements, including being the third-largest smartphone maker in 2013 and its contributions to Android OS development, LG’s mobile devices have seen a decline in consumer favor due to various software and hardware issues and slower software updates.
The company’s withdrawal from the smartphone market was not an overnight decision. LG has been gradually pivoting away from mobile phones, seeking to concentrate on more lucrative and less competitive sectors. This strategic reorientation includes enhancing its presence in the electric vehicle components market, leveraging its expertise in mobile technologies to innovate in areas like user intent detection, drowsiness monitoring, and gesture interactions for vehicle systems.
Moreover, LG has not entirely abandoned the telecommunications technology domain. It has been actively involved in patent licensing, showcasing its continued influence in the mobile tech landscape. For instance, LG has previously licensed its LTE technology to Tinno Mobile, underlining its commitment to safeguarding its intellectual property while fostering consumer access to innovative technology.
This development has significant implications for the global smartphone market, particularly in regions like North America and Latin America where LG held substantial market shares. Analysts predict that LG’s exit will benefit other smartphone manufacturers, including Samsung, Apple, and Chinese brands like Oppo, Vivo, and Xiaomi, by allowing them to capture LG’s former market share.
LG’s focus on retaining its 4G and 5G core technology patents and its research and development personnel indicates the company’s ongoing investment in future communications technologies, including 6G. This forward-looking approach suggests that while LG has exited the smartphone manufacturing and sales arena, its technological innovations will continue to influence the industry for years to come.
